Question

An abnormally large grain crop due to highly favorable weather conditions in the Midwest is an example of

Answers:
a. an unexpected development that will lead to excess supply and widespread unemployment.
b. a technological improvement that will increase long-run aggregate supply.
c. an unexpected development that will reduce the natural rate of unemployment.
d. a supply shock that will increase short-run aggregate supply.

Answer 1

d. a supply shock that will increase short-run aggregate supply

A supply shock is an unexpected event that changes the supply of a product or commodity, resulting in a sudden change in price.